19% 'skip loan payments on purpose'

One in five Britons has deliberately skipped a loan repayment in recent years because they could not afford it, a study has suggested.

Credit reference agency Experian warned the problem of people missing payments appears to be on the increase, which will drag down their ability to borrow more cash in the future.

Some 19% of more than 3,000 people surveyed said they had missed a payment on purpose in the last six years because they did not have the funds. These payments were missed on various types of borrowing, such as personal loans, overdrafts, credit cards and store cards.

Six years is the length of time that a missed payment will remain on someone's credit records before the slate is wiped clean. Failure to stick to agreements over cards, loans and overdrafts will show up on someone's credit records and make it tougher for them to take on more borrowing.

Another common reason Experian found for people not making a credit payment was that they had simply forgotten, with 28% of people across the survey saying this.

Experian said it found evidence that the problem of missed payments is getting worse. Nearly half of people (45%) who had missed a payment said the most recent time they had done so was in the last year. One quarter said their last missed payment was between one and two years ago and one in seven said that the last time it happened was between three and four years ago.

Meanwhile, 14% of those surveyed said they only ever make the minimum repayments, meaning that they are likely to be building up large amounts of interest.

Just making minimum repayments can also adversely affect someone's ability to borrow more cash in some cases, as lenders may assume that the borrower is struggling to clear their debts.

Almost one third (32%) of those surveyed said that they constantly worry about money and one in six said that they dread opening their card statements.

Peter Turner, managing director at Experian Consumer Services, UK & Ireland, urged anyone having problems repaying their credit to talk to their lender and seek help from debt advice charities.